When the Android-based G1 smartphone debuted six months ago, it was heralded as the biggest smartphone game changer since Apple's iPhone arrival in June 2007, thanks to the newcomer's open source platform and its powerful backer -- Google.

And while the Android has lagged in third-party application development since the G1's launch, it may be poised to close on Apple's (NASDAQ: AAPL) wide lead in downloadable apps.

That's if Android makes good on plans to begin adding paid applications to its Android Market store -- a move that could happen as soon as week's end, according to a report in the Wall Street Journal that cited unnamed sources.

"The only thing we've publicly announced is that paid applications are coming to Android Market in Q1 of 2009," a spokesperson from Google told InternetNews.com. The company initially revealed those plans in connection with the G1's introduction in late September, a month before the Android Market actually went live. The spokesperson declined additional comment and said the company would post any updates to Android's efforts on its developer blog.

The report comes as third-party software development is emerging as a way for carriers and smartphone manufacturers to lure new customers and retain subscribers. Increasingly powerful devices and improvements in hardware design, such as the touchscreen popularized by Apple's iPhone, have also further encouraged software development on the platforms -- in turn, enticing buyers seeking mobile games, tools and productivity applications.

In mid-December, Palm launched its own mobile storefront, the Palm Software Store. The next month, the Treo maker gave a first look at its upcoming smartphone, the Pre, which will hinge heavily on a sleek design, an iPhone-like touchscreen -- and downloadable apps. The company's storefront opened with 5,000 applications for over 25 existing Palm (NASDAQ: PALM) devices, with about 1,000 of the applications available for free.

Microsoft is also thought to be weighing an Apple-like storefront for mobile downloads, according to a Journal report. Meanwhile, BlackBerry maker Research in Motion has plans in place to debut a store for its own ubiquitous line of smartphones within the next several weeks.

Apple at the forefront

Leading the recent charge into downloadable applications has been Apple's App Store, which debuted just days after the iPhone 3G launched last July.

Modeled after Apple's wildly successful iTunes store for downloading music, podcasts and videos, the App Store tallied 10 million application downloads in its first week. While the uptake benefited from existing users of Apple's first-generation iPhone, the pace has yet to show signs of slacking: Since then, users have downloaded a total of 300 million apps, according to the company, with about 10,000 programs available for download as of December.

[cob:Special_Report]In comparison, the Android Market opened last September with 50 free applications -- less than ten percent of Apple's figure at launch. And while Google told InternetNews.com that the number has since risen to 1,000, it's still a huge gap for Android to close.

Still, its software's development community offers two things Apple's lacks: fewer restrictions and a bigger share of the profit. And both could help woo developers to the fledgling platform.